EU’s AI Act Draft: Navigating New Challenges for Tech Companies

EU Unveils Fresh Draft of AI Act Rules

The European Union has recently published a new draft of rules concerning the use of general-purpose artificial intelligence (AI) models. This draft addresses technologies such as OpenAI’s GPT-4 and Mistral’s Large, but critics continue to voice significant concerns regarding the implications for tech companies operating within the EU.

Overview of the AI Act

The AI Act is positioned to be the most comprehensive set of laws governing AI technology globally. It introduces a multitude of new regulations for organizations utilizing AI within the EU, emphasizing ethics, safety, and transparency.

Key Developments

Since late last year, stakeholders from various sectors—including industry, academia, and nonprofits—have been engaged in discussions surrounding a pivotal document: the code of practice for general-purpose AI (GPAI).

On March 11, 2025, the European Commission unveiled the third draft of this code of practice. Noteworthy proposals include:

  • Opening up AI companies’ training data to investigate potential copyright breaches.
  • Permitting external experts to inspect models for safety compliance.

Industry Concerns

Despite the advances in the draft, there remain critical issues. Boniface de Champris, a senior policy manager at the Computer & Communications Industry Association (CCIA) Europe, voiced strong concerns about the implications for tech firms. He stated, “Serious issues remain, including far-ranging obligations regarding copyright and transparency, which would threaten trade secrets.”

Moreover, the draft continues to impose burdensome external risk assessments, which many industry insiders believe could hinder innovation.

Implications for Digital Competitiveness

De Champris further remarked, “The new draft makes limited progress from its highly problematic predecessor, yet the GPAI Code continues to fall short of providing companies with the legal certainty that’s needed to drive AI innovation in Europe.”

In its current state, the AI Act poses risks that could directly undermine the EU’s digital competitiveness, creating uncertainty for companies looking to invest in the region.

As discussions continue, the balance between regulation and innovation remains a critical focal point for all stakeholders involved in the evolving landscape of artificial intelligence.

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